European clearing house LCH.Clearnet has launched a clearing service for credit default swaps with the support of four leading French dealers.
LCH.Clearnet in Paris is working with French banks BNP Paribas, Societe General, Credit Agricole and Natixis, for clearing of euro-denominated CDS on corporate indices.
The move is seen as a blow for London - which has long functioned as the centre of gravity for over-the-counter derivatives trade in Europe - and marks an ambitious push by the French to take a leadership role in the supervision of financial markets in a post-crisis Eurozone.
Germany's attempt to stake a claim under the auspices of Eurex have faltered, with the Deutsche Bourse subsidiary so far signing up only two dealers to its equivalent CCP.